2013 (12) TMI 870 - AT - Central Excise

Improper benefit of Notification No. 23/1998 availed - Newsprint Rolls cleared Waiver of pre-deposit Held that - The papers which is intended for newspapers and should be cleared against a purchase order placed upon the manufacturers - the appellant is a manufacturer of paper of a kind which is intended for utilising in printing of newspaper - the news print Rolls stored in the unregistered premises were supplied against a purchase order placed by a newspaper on the appellant - the adjudicating authority has confirmed the demand but has not classified the product under which head he intends to demand the duty, as the classification under heading 4801 is not rejected and no other classification is made for the product, for demanding the duty prima facie the appellant has made out a case in their favour Pre-deposits waived till the disposal Stay granted.

Summary

Issues Involved:
Waiver of pre-deposit of duty and penalty for clearing Newsprint Rolls under Notification No. 23/1998-CE.

Analysis:
The appellant filed an application seeking waiver of pre-deposit of duty amounting to Rs. 1,62,39,230/- and an equal amount of penalty imposed by the adjudicating authority for allegedly availing improper benefit under Notification No. 23/1998-CE. The appellant had cleared Newsprint Rolls from unregistered premises due to space constraints and subsequently supplied them to newspaper printers as per the Newsprint Control Order, 2004. The appellant argued that the adjudicating authority failed to consider their space shortage issue and cited a tribunal decision on a similar matter under a different notification. The respondent contended that the appellant cleared the rolls from an unregistered depot, which should be strictly construed as a place of removal. The key issue was the duty liability on the Newsprint Rolls cleared by the appellant, falling under chapter heading 4801 with a nil tariff rate. The Notification in question defined 'newsprint' for manufacturers supplying to newspapers against purchase orders. The tribunal noted that the appellant met the criteria specified in the Notification and that the adjudicating authority did not classify the product for duty demand under any specific heading, thereby allowing the appellant's prima facie case for waiver of pre-deposit.

This judgment primarily revolved around the interpretation of Notification No. 23/1998-CE regarding the duty liability on Newsprint Rolls cleared by the appellant. The tribunal analyzed the criteria specified in the Notification, focusing on the intended use for newspapers and supply against purchase orders from registered newspapers. The tribunal emphasized that the appellant met these criteria and highlighted the lack of specific product classification by the adjudicating authority for duty demand. By considering the appellant's space shortage issue and a previous tribunal decision, the tribunal concluded that the appellant established a prima facie case for the waiver of pre-deposit, thereby allowing the application and staying the recovery until appeal disposal.